US trade report on India’s trade relation

Description

Context: An annual report submitted by the U.S. Trade Representative (USTR) to Congress, calls India’s policies “trade-restrictive” and says the “Make in India” campaign epitomises the challenges to the trade relationship.

Details:

While India’s large market, economic growth, and progress towards development make it an essential market for many U.S. exporters, a general and consistent trend of trade-restrictive policies have inhibited the potential of the bilateral trade
Recent Indian emphasis on import substitution through a “Make in India” campaign has epitomised the challenges facing the bilateral trade relationship.
The Make in India campaign was launched by Prime Minister Modi in 2014 to incentivise production in India.
The report describes the Trump administration’s revocation of India’s preferential trading status under the Generalised System of Preferences (GSP) program in June 2019 and the ensuing discussion to achieve a mini trade deal (“package”) throughout 2020.
In a section on Digital Service Tax, a Section 301 investigation on India’s DST, which began in June last year, is highlighted. The investigation is ongoing, as per the report.

Make in India:

Make in India is an initiative by the Government of India to encourage companies to manufacture in India and incentivize dedicated investments into manufacturing.
The policy approach was to create a conducive environment for investments, develop a modern and efficient infrastructure, and open up new sectors for foreign capital.
The initiative targeted 25 economic sectors for job creation and skill enhancement, and aimed "to transform India into a global design and manufacturing hub."
"Make in India" had three stated objectives:
- to increase the manufacturing sector's growth rate to 12-14% per annum;
- to create 100 million additional manufacturing jobs in the economy by 2022;
- to ensure that the manufacturing sector's contribution to GDP is increased to 25% by 2022 (later revised to 2025).